Do I have time for Innovation?
Time is a key factor in innovation, mainly for two reasons concerning success in commercialization:
To be the first one into market gives known advantages.
Results must show up in an expected time to be profitable.
Therefore, we must ask ourselves if we have enough time for developing in an effective manner before the opportunity is gone. Market, opportunities, customer needs, technology have an increasing inertia. Innovation is usually related to high investments in technology, however when a product fails it is not usually because of the resources or the technology. Around 90% of projects are unsuccessful in commercializing and need to pivot and redefine. Consequently, the process of innovation need to move quickly to keep up.
We have many examples concerning the rule of “faster fish eats bigger fish” like Nokia or Kodak. Companies like these with a strategy mainly focused on daily problems and current products, have the risk of just looking at the short term.
Creating tight deadlines, flooding the project with resources, checking in more frequently doesn’t avoid the frustration by executives caused by the slow pace, and in many cases, it doesn’t seem to work because this type of team actually moves slower.
If speed and innovation are so important, how can we accelerate the search for a viable new-growth model?
Form small and focused teams: They will move faster than large teams, they will maximize flexibility and the speed of learning and decisions can be made quickly. Innovation is creative and it needs time and focus. This is one of the reasons why a small start-up or a spin-off have certain advantages pushing an innovation process as the team is focused on the new product development.
Get out of the building and learn: The search of tomorrow’s business has to be conducted in or close to the market. The interaction and prospective search with customer, partners and suppliers is a huge fountain of knowledge. Innovation is not a clear path, it is instead a learning process where companies learn while they are innovating. In this sense, the main challenge is to find the way to learn in a productive and cost effective way, to make quick and cheap mistakes, pivot and redefine and keep learning. Time management became therefore important and agile methodologies are key for anticipating any failure or mismatch.
Get out of the building and look for synergies: Another way to innovate faster is to look for support in the network. Along the innovation process from idea generation to implementation, collaborative environments help to reduce time, be more cost-effective and therefore decrease risks.
Measure learning, not results: It is better to push the team in progressing on what they learn and what they need to know, than in financial forecasts that are unreliable.
Tie funding to risk reduction: Most venture capitalists don’t hand out in the same way that corporations do when they fund ongoing operations. Rather, they provide capital for addressing critical uncertainties like whether they can overcome key technical challenges, hire the right team, or convince customers to pay for a given solution. If these uncertainties can be resolved, the innovators have a better chance of getting another round of funding. Uncertainty is the key for risk reduction because it is better to pull the plug early than unnecessarily waste time and resources.
Guide the team: The team needs the help of a decision maker with an extensive knowledge of the context, market and technology. Otherwise the need for finding this knowledge will slow the team’s progress even more.
Evidently, to have the final success in commercialization is not a matter of resources or high investment, but of focus, agile methodologies and interaction with the network. To innovate is a learning and iterative process, which needs time and equally needs to progress as fast as possible.